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The Stock That Got Away

Interestingly, Apple traded sideways for the next couple of years. By 2006, it hit the $70 range, and it was near $200 by the end of 2007. During the "market madness" of late 2008 and early 2009, shares fell below $100, but since then, they have not really looked back on the run to $700 and world domination. AAPL Chart AAPL data by YCharts

I however, have looked back, because it is important to analyze investment successes and mistakes. In this case, I had no idea how big the iPod would become, and no idea about the level of innovation in other products that Apple would bring to the market. I understood that the company was trading for less than cash, but for whatever reason, that was not enough at the time.

If I had purchased the shares when they were trading for less than the company's cash, I wonder how long I would have actually held them. Not long enough, I suspect. Even a well-placed trailing stop-loss, adjusted as shares rose, would probably not have done the trick.

All of this leads me to a question. What names am I currently shunning that have Apple-like potential? Facebook (FB)? I don't think so. Here's the difference, and part of the lesson learned: Expectations for Apple in the early 2000s were low, and this was priced into the stock. I can't say the same about Facebook.

At the time of publication, Heller had no positions in stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Follow @JonMHellerCFA

Jonathan Heller, CFA, is president of KEJ Financial Advisors, his fee-only financial planning company. Jon spent 17 years at Bloomberg Financial Markets in various roles, from 1989 until 2005. He ran Bloomberg's Equity Fundamental Research Department from 1994 until 1998, when he assumed responsibility for Bloomberg's Equity Data Research Department. In 2001, he joined Bloomberg's Publishing group as senior markets editor and writer for Bloomberg Personal Finance Magazine, and an associate editor and contributor for Bloomberg Markets Magazine. In 2005, he joined SEI Investments as director of investment communications within SEI's Investment Management Unit.

Jon is also the founder of the Cheap Stocks Web site, a site dedicated to deep-value investing. He has an undergraduate degree from Grove City College and an MBA from Rider University, where he has also served on the adjunct faculty; he is also a CFA charter holder.

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